Mumbai, April 17: The Diwali windfall has come six months early for employees of software services giant Tata Consultancy Services (TCS) which on Thursday announced Rs 2,628 crore ($423 million) one-time bonus to its staff to mark 10 year of its public listing.

It is probably the biggest-ever bonus payout by an Indian company .

The city-headquartered TCS said all employees who have completed at least one year in service will be eligible for the bonus and will get a reward equivalent of one week's salary for every year of service. As of end March, it had 3,19,656 employees.

"TCSers are well-known for their ability to execute, innovate and provide leadership in the customers' context. This special reward acknowledges the role they have played in building TCS," Chandrasekaran said.

"There was a discussion on the bonus at the board, and I am happy it was considered favourably. The pay-out will be done in April and May. But the company has decided to recognise the liability upfront and provided for it in the March earnings," MD & CEO Natarajan Chandrasekaran said during the earnings announcement in the evening.

The huge payout has resulted in the company reporting a steep 27 per cent decline in net profit at Rs 3,858.2 crore, despite close to 13 per cent rise in revenue at Rs 24,219.8 crore during the March quarter.

Explaining the rationale for upfront provision for the bonus, TCS Group chief financial officer Rajesh Gopinathan said, "Generally, when the payout is linked to certain objectives getting met, companies ammortise the outgo over a long term, but we decided to take it upfront because this is not the case with us."

When asked about the recent controversy over attrition and its linkage to the bonus, Chandrasekaran avoided a direct reply but said the involuntary attrition continues to remain under 1 per cent but the larger worry for him is the spike in overall attrition which came in at 14.9 per cent in the fourth quarter.

He attributed the high attrition to the larger demand for trained IT professionals across the board as the business outlook starts look up for companies.

TCS was listed on August 25, 2004, after a runaway IPO that was oversubscribed 19.2 times, raising over Rs 5,300 crore. Through the issue, Tata Sons offered 5.545 crore shares with a face value of Re 1 and at a premium of Rs 849. The shares were listed at Rs 1,076 apiece.

On May 2, 2012, TCS became the most valued company in terms of market capitalisation with an m-cap of Rs 2,48,116 crore, overtaking RIL's Rs 2,43,413 crore, and by July 24, 2014, it created history by becoming the first company to have an m-cap of over Rs 5 lakh crore.

TCS commands such a high valuation despite the fact that the promoters still owns 73.90 per cent with the public owning just 26.10 per cent, 1.1 per cent above the regulatory requirement.

At the end of the trade on Thursday, TCS commanded a valuation of Rs 506,363.12 crore and the counter closed at Rs 2,585.20, down 1.50 per cent on a day when the Sensex lost 134 points. During the year, the company script had touched a high of Rs 2,834 on the BSE.

On August 26, 2013, TCS became the second most valuable IT company in the world in terms of its share price with an m-cap of Rs 3,95,975 crore or $58.66 billion after IBM's $200 billion valuation.

This special reward to employees acknowledges the role the employees have played in building TCS into one of the most respected and valued technology services companies in the world, Chandrasekaran added.

Founded in 1968 by the late JRD Tata, TCS had a revenue of Rs 94,648 crore or USD 15.5 billion, up 15.7 per cent in FY15.

TCS net falls 27% to Rs 3,858cr on employee bonus

Meanwhile, TCS reported a 27 per cent dip in its March quarter net profit at Rs 3,858.2 crore, impacted by one-time Rs 2,628 crore employee bonus, but exuded confidence about surpassing the industry average in the current fiscal.